PSA Peugeot Citroen said it has chosen the Indian state of Gujarat to build a $928-million factory capable of turning out 170,000 vehicles per year.
The integrated manufacturing and engine and gearbox facility, which should come online in 2013, will generate 5,000 new jobs in the rapidly developing Sanand automotive cluster, the company said..
"We view India as one of the most important and dynamic markets in the world, with forecasts of it becoming the third-largest automotive market by 2020," said PSA Peugeot Citroen chief executive Philippe Varin at a signing ceremony with Gujarat state officials.
The factory is expected to begin manufacturing a mid-size family sedan.
PSA Peugeot Citroen announced in February that it intended to begin manufacturing in India. It made an unsuccessful attempt to set up in the country in the 1990s.
Copyright Agence France-Presse, 2011